As the global trading system comes under increasing strain from US tariffs and rising trade pressure, trade policy experts in Australia and Europe say deeper collaboration between Australia and the European Union (EU) is critical to protecting the rules-based international trading system.
The recommendations are outlined in a new e-book, Australia–EU Trade Relations in the Global Context, released this week by Adelaide University’s Institute for International Trade (IIT) and the Australian Centre for International Trade and Investment (ACITI). The publication brings together expert contributions from researchers around Australia and in Europe.
“As economies that value open markets, democracy and the rules-based trade system, geoeconomic disruption has radically increased the importance of Australia and the EU working together to protect these institutions,” said Professor Peter Draper, Executive Director of IIT, who led the publication alongside Dr Prudence Gordon, Executive Director of ACITI.
“The e-book identifies a range of policy areas where Australia and the EU can lift cooperation for mutual economic and systemic benefit. These include concluding the Australia–EU free trade agreement, EU engagement with the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, and renewed efforts to reform the World Trade Organization.
“The EU’s experience of regulation in areas such as carbon border adjustment, AI and investment provides insights and learning that can inform Australia’s consideration of regulation in these areas.”
Dr Gordon said coercive trade actions, including US tariffs and China’s growing use of trade leverage, have made trusted trade partnerships a strategic priority.
“All countries, including Australia and the EU, are seeking to diversify their trade relationships and build new strategic trade corridors,” Dr Gordon said.
“For Australia, the free trade agreement with EU will complete its network of FTAs with major trade and investment partners, thereby cementing the Australian government’s drive to diversify economic relationships through trade cooperation.”
Professor Draper said the EU is a uniquely important partner for Australia, describing it as one of the three “big beasts” in shaping the global trading system.
“It is the world’s second-largest collective economic area and consumer market, and one well suited to many Australian exports, from agriculture and resources to sophisticated financial and information technology services,” he said.
“At the same time, the EU has a strong strategic interest in expanding its market access in the Asia-Pacific, with Australia playing an important role in that context.”
The e-book also identifies Australia’s endowment of critical minerals and rare earths, essential to Europe’s green transition and defence industries, is a key anchor for deeper investment and cooperation, as well as development of Australia–EU–ASEAN value chains, and coordinated approaches to economic security and supply chain resilience.
The IIT brings together leading academics and experienced practitioners to address global trade and investment challenges.
“By bringing analytical rigour and evidence to bear on complex, sometimes sensitive issues, our Institute can cut through the politics of interest-group-based bargaining to shed light on the underlying benefits and costs to society of forging closer trade and investment partnerships at the national level,” Professor Draper said.
“As such, we are a trusted, independent, authoritative voice on Australia’s trade policies and strategies.”
Media contacts:
Professor Peter Draper, Executive Director of Institute for International Trade, Adelaide University. Email: peter.draper@adelaide.edu.au
Dr Prudence Gordon, Executive Director, Australian Centre for International Trade and Investment. Email: pgordon@aciti.org.au
Lara Pacillo, Media Officer, Adelaide University. Mobile: +61 403 659 154. Email: lara.pacillo@adelaide.edu.au